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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Jacob Snyder who wrote (61573)	3/6/2002 3:26:23 PM
From: Jan Crawley	Respond to of 70976

Does this count as "effectively closing my position", for tax purposes? Jacob, it's not. If your shares are called in July then it is a taxable event for both(shares gain$ and premium$). But if the option expires(or you close the option before the expiry); then only the net premium$ is a St-gain.

To: Jacob Snyder who wrote (61573)	3/6/2002 4:28:31 PM
From: Sam Citron	Read Replies (1) \| Respond to of 70976

Does this count as "effectively closing my position", for tax purposes? Careful. The rules are complicated. As I understand them: If the call write is in the money when written, but not too deeply, then the holding period is suspended while the call is in place. If the call is deep in the money when written and the stock is not yet held longterm, then the holding period for the stock is eliminated. As long as the equity option was out of the money when written, it has no effect on the holding period of the stock. Better check with an advisor if you have questions, but see irs.gov pps. 55-56 CAVEAT: This should not be relied upon or considered tax advice. The writer is a layperson, not an accountant nor an attorney. Actually I am a retired attorney (inactive).